Shortage and high LDPE prices remain in the Russian market in October

MOSCOW (MRC) -- September scheduled outages at low density polyethylene (LDPE) production led to higher prices in the Russian market. A shortage of polyethylene (PE) has remained in October, despite stable operations at the plants, prices also remained high, according to ICIS-MRC Price report.

Scheduled shutdowns at LDPE production at Kazanorgsintez and Ufaorgsintez in September led to a shortage in the market. There was no outages in October with the exception of Ufaorgsintez. But, the shortage of PE, as well as a high price level, remained in the Russian market.

The LDPE 108 market accounted for the accutest shortage in supply during the whole month. The main reasons were low capacity utilisation at Ufaorgsintez (maintenance works and a shortage of feedstock because of outages for turnarounds at local gas processing plants - GPPs) and Angarsk Polymer Plant's high PE prices (Rb57,500/tonne FCA Angarsk, including VAT). Prices for PE 108 were in the range of Rb59,200-61,500/tonne CPT Moscow, including VAT, in the last week of October.

Price offers for Russian LDPE 158 were in a quite wide range of Rb59,000-62,000/tonne CPT Moscow, including VAT, in the last week of October. Offers for Belarusian PE were absent because of a scheduled shutdown for a turnaround at Polymir.

Supply was excessive and demand was weak in the shrinkable film PE market because of a seasonal factor. PE prices were in the range of Rb61,000-62,500/tonne CPT Moscow, including VAT.

Ufaorgsintez has finished all the maintenance works and has reached the designed capacity by November. Belarusian Polymir has resumed production of LDPE 158, which is expected to be shipped to the Russian market in the near future. But, major changes are unlikely to take place in the market in the first decade of November.

The leading Russian LDPE producers - Kazanorgsintez and Tomskneftekhim - increased their exports more than twice in October after September decline on the back of higher prices in foreign market. Large sales of Russian PE are also expected in November, which will sustain a lack of demand in the domestic market.
MRC

MOSCOW (MRC) -- South Korea's LG Chem is in plans to shut its cracker for maintenance turnaround, according to Apic-online.

A Polymerupdate source in China informed that the cracker is likely to be shut in November 2014. It is likely to remain off-stream for around one month.

Located in Yeosu, South Korea, the plant has a production capacity of 1 million mt/year.

As MRC reported earlier, LG Chem lowered the operating rate at its 650,000 mt/year acrylonitrile-butadiene-styrene (ABS) plant at Yeosu to 70% of capacity in October from 80% in September.

LG Chem also plans to start operations at a new 150,000 mt/year ABS plant in Huizhou, southern China's Guangdong province, toward the end of this year or in Q1 2014, sources close to the company said earlier. The plant will be a joint venture with state-owned China National Offshore Oil Corp.

LG Chem Ltd., often referred to as LG Chemical, is the largest Korean chemical company and is headquartered in Seoul, South Korea. According to ICIS report, it is 15th biggest chemical company in the world in 2011. It has eight domestic factories and global network of 29 business locations in 15 countries. LG Chem is a manufacturer, supplier, and exporter of petrochemical goods, IT&E Materials and Energy Solutions.

MRC

MOSCOW (MRC) -- Chevron Phillips Chemical Company LP (Chevron Phillips Chemical) has received board approval to execute the US Gulf Coast (USGC) Petrochemicals Project first announced in March 2011, as per Plastemart.

Additionally, the company awarded an engineering, procurement and construction (EPC) contract to a joint venture between JGC (USA), Inc. and Fluor Enterprises, Inc. to execute the 1.5 mln tpa (3.3 bln lb/a) ethane cracker portion of the project.

The company has also awarded an EPC contract to Gulf Coast Partners, a partnership between Technip USA Inc. and Zachry Industrial, Inc., to execute the two new polyethylene (PE) facilities, each with an annual capacity of 500,000 metric tons.

The state-of-the-art, world-scale polyethylene units will be capable of producing a wide variety of high and linear low density polyethylene (LLDPE) products including bimodal and metallocene-based polyethylene polymers. These facilities will incorporate Chevron Phillips Chemical’s leading edge metallocene technology and proprietary Advanced Dual Loop bimodal technology.

In addition to the bimodal and linear low density products, the flexibility of these units will allow for growth of current blow molding, injection molding and film grades offered by Chevron Phillips Chemical. Sold under the long-established brand names of Marlex resins for rigid packaging and extrusion applications and Marflex resins for film and extrusion coating applications, the new production facilities will be complemented by expansion of Chevron Phillips Chemical’s Technical Service capability offering sustainable solutions in a wide variety of applications ranging from flexible packaging to high performance pressure pipe.

The ethane cracker will be built at Chevron Phillips Chemical’s Cedar Bayou plant in Baytown, Texas, and two polyethylene units will be built at a site in Old Ocean, Texas, near Chevron Phillips Chemical’s Sweeny plant.

In August 2013, Chevron Phillips Chemical announced that the company had received the cracker’s Environmental Protection Agency (EPA) greenhouse gas permit and the required Texas Commission on Environmental Quality (TCEQ) air permits necessary to commence construction of both facilities.

The USGC Petrochemicals Project is expected to commence construction in early 2014 and create approximately 400 long-term direct jobs and 10,000 engineering and construction jobs.

As MRC wrote previously, this summer, Chevron Phillips Chemical Company LP (Chevron Phillips Chemical) announced it will expand its ethylene production by 200 million pounds by adding a tenth furnace to ethylene unit 33 at its Sweeny complex in Old Ocean, Texas.
MRC

MOSCOW (MRC) -- DSM Dyneema, the manufacturer of ultra high molecular weight polyethylene (UHMwPE) fiber, branded as Dyneema, and world leader in life protection materials and high performance fibers, sees the adoption of next-generation lighter material technologies, reported Plastermart.

It is the company's answer to the present major trends that are intensifying the impact of weight and underscoring the urgent need for new, lighter materials for military, law enforcement and security personnel' gear that can deliver top protective performance combined with usability.

The performance and endurance of military, law enforcement and security personnel have always been affected by the weight of their gear. Multiple global government initiatives are underway to reduce the weight of personal protective equipment for soldiers.

This view is supported by experts, who predict the use of UHMwPE materials in body and vehicle protection will show double-digit growth in the next five years.

Dyneema UHMwPE materials provide top ballistic performance combined with light weight and flexibility for enhanced comfort and agility for the body armor. Inherently, the fiber is 40% lighter than competitive materials yet offers exceptional ballistic protection as well as excellent resistance to moisture and chemicals.

We remind that, as MRC wrote previously, DSM is going to invest about EUR100 million in three new R&D facilities in Delft and Sittard-Geleen (both in the Netherlands) over the next two years.

DSM delivers innovative solutions that nourish, protect and improve performance in global markets such as food and dietary supplements, personal care, feed, pharmaceuticals, medical devices, automotive, paints, electrical and electronics, life protection, alternative energy and bio-based materials.
MRC

MOSOCW (MRC) -- Chevron is set to finally sign on the dotted line for its Olesska shale production sharing contract after sealing the final regional approval required for the USD10 billion project, said Upstreamonline.

The US supermajor and Ukraine are to sign the PSA next Tuesday at a regional economic forum, Ecology Minister Oleh Proskuryakov was quoted by Reuters as saying.

Chevron had initially agreed with the Ukrainian government in May 2012 on a 50-year licence for the acreage in western Ukraine.

Deputies in the Ivano-Frankovsk region rejected the original terms of the licence in August before agreeing to amended terms a month later granting regional authorities a 10% slice of state revenues from Olesska.

Last week, deputies in the Lviv region also accepted the PSA, clearing the final hurdle for the agreement to be signed.

Ukraine's State Geological Service estimates the reserves of gas-rich Olesska could total between 800 billion and 1.5 trillion cubic metres.

In January Shell signed another USD10 billion agreement on shale exploration and extraction at Yuzivska in eastern Ukraine.
MRC